October 06, 2020

Data on food price rigidities can serve as inputs for RBI decisions

In this article, Niranjan Rajadhyaksha discusses the centrality of food price variations for monetary policy decisions. Excerpt below:

 

"The Indian central bank has an official mandate to target consumer price inflation. India is unique among countries with inflation-targeting mandates because nearly half its consumer price index consists of food prices. One solution is that an updated monetary policy framework should ask RBI to target core inflation rather than the headline number."

 

Read the full article here.

 

 

Topic : State Capacity / In : OP-EDS
Tags : RBI , MPC , CPI target
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